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Facebook sued for misleading investors before stock plunge

Zuckerberg freefall: In one of the biggest single-day drops in history, Facebook has officially dropped $123 billion in stock market value, as of Thursday.

Other big Facebook investors also took a hit as disappointing second-quarter results obliterated $119 billion of market value, the most ever in a day for a US company.

The lawsuit is designed for class-action status and seeks unspecified damages. A Facebook spokesman declined to comment.

The drop translates to a US$119.4 billion ($176 billion) decline in market capitalisation, the largest-ever loss of value in one day for a USA traded company.

Late Wednesday, Facebook warned that its revenue growth will slow down significantly for at least the remainder of the year and that expenses will continue to skyrocket.

Facebook has faced a series of crises over the past two years, starting with Russian interference on the platform during the 2016 election and continuing with this year's Cambridge Analytica data privacy scandal.

Both the slower growth forecast and heavier spending reflect problems largely of Facebook's own making.

A DE judge says he wants to hear from Facebook founder Mark Zuckerberg before ruling on attorney fees in a shareholder suit challenging a proposed stock reclassification.

Facebook shares fell another 0.8 percent on Friday, closing at $174.89 on the Nasdaq.

Mr Zuckerberg had been tied with Mr Warren Buffett as the world's fourth-richest person, but the Berkshire Hathaway Inc chairman's current US$83 billion fortune tops Mr Zuckerberg's US$66 billion, Forbes magazine said. Technology companies account for six of the 10 biggest companies in the S&P 500 Index. Compared to a year ago, Facebook's margins dropped three percent in its second quarter.

These quotes and average results from its second quarter caused Facebook's stocks to drop a whopping 19 per cent overnight.